Stunning push to scrap Medicare

The boss of health insurance provider NIB has called on the government to scrap Medicare and institute compulsory private coverage for all Australians.

Mark Fitzgibbon made the stunning pitch in an opinion piece in today's Australian Financial Review, calling on the country to adopt a similar healthcare model to the United States.

He said health insurers faced a growing crisis due to skyrocketing costs and described the Medicare system as a "government monopoly".

"(The) sensible policy approach would be to make private health insurance compulsory for all Australians with taxation devoted to subsidising the premiums for those who would otherwise be left behind," Mr Fitzgibbon wrote in the business newspaper.

"That is, high-income earners would at one end of the scale pay the entire premium while at the other, those with low income fully subsidised."

His call comes on the back of a warning from The Grattan Institute last week that the health insurance industry was in a "death spiral".

Young people increasingly can't afford hefty and ever-increasing premiums and providers face an inevitable defeat from the ageing population, the report said.

While he distanced himself from claims of a sector "death spiral", Mr Fitzgibbon conceded private health insurers faced a tough future.

But so too did the economy and the country's bottom line, he argued.

"How do we continue to pay for a universal healthcare system with an ageing population, burgeoning spending and ever-increasing dependency ratio of older retired Australians to younger taxpayers?"

In his piece today, he insisted the idea wasn't overly controversial or divisive.

"It's hardly a radical proposition when you consider Medicare is itself a compulsory 'social insurance' system. It's not as if you or I can opt out of Medicare," Mr Fitzgibbon wrote.

"And (it's) no different to the approach taken by many 'left-leaning' European governments that don't feel it necessary to actually run a health insurance system to ensure cost-effectiveness and fairness."

That's not a view widely shared, with an overwhelmingly negative response to Mr Fitzgibbon's op-ed in Canberra and beyond.

Health Minister Greg Hunt quickly shot down the proposal, saying that the Coalition remained "committed to (Medicare) for life, forever".

"I did see one comment today questioning Medicare, and I have to say clearly and categorically that we reject that proposition: clearly, categorically and absolutely," he told reporters in Canberra.

"But equally, we're committed to private health insurance. Both of those elements are part of the model that best serves Australians."

The idea hasn't gone down well on either side of politics, with Australian Unions vowing "we'd turn out in the streets in our millions if they even dared".

Former Treasurer Wayne Swan, now Labor's national president, also attacked the proposal.

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